Proceedings of the Standing Senate Committee on
Agriculture and Forestry
Issue 23 - Evidence, April 17, 2007
OTTAWA, Tuesday, April 17, 2007
The Standing Senate Committee on Agriculture and Forestry met this day at 7:02 p.m. to examine and report on rural poverty in Canada.
Senator Joyce Fairbairn (Chairman) in the chair.
[English]
The Chairman: Good evening, honourable senators, witnesses and our viewing audience.
Last May, the committee was authorized to examine and report on rural poverty in Canada. Last fall, we heard from a number of expert witnesses who gave us an overview of rural poverty in Canada. On the basis of that testimony, which shook all members of the committee, we wrote an interim report that was released in December 2006 and which, by all accounts, truly struck a nerve.
We are in the midst of our second phase of the study, where we meet with rural Canadians in rural Canada. To date, the committee has travelled to the four eastern and the four western provinces. Along the way, we have met a truly wonderful and diverse group of rural Canadians, who have welcomed us with open arms into their communities and sometimes even into their homes.
The committee still has much work to do and will visit communities in Ontario and Quebec. We will hear from as many people as possible. We need to ensure that we get this right and truly understand rural poverty at its core. To that end, we continue to invite witnesses to appear before the committee in Ottawa to provide their testimony.
We are fortunate this evening to have witnesses from Powassan, Ontario: Bob Young, Mayor of Powassan, and Roger George, Chair of the Economic Development Committee. Mr. George, please proceed with your presentation.
Roger George, Chair, Economic Development Committee, Municipality of Powassan: Thank you very much for allowing us this privilege of being here before you this evening. Powassan is a great little hockey town but we have never faced off against the Senators. We hope that you will win this one because this task you are faced with is so important.
My original interest in appearing before this Senate hearing was a personal one that embraced my 35 years of living in Canada, having moved from England in 1972. I have lived and farmed in the Powassan area all those years. I have had a Main Street business and have had the honour of being a national farm leader, a rural lobbyist, activist and political advocate. I have talked the rural talk and walked the rural walk every day over these past 35 years and enjoyed the privilege, like senators here today, of sharing in the triumphs and despairs of farmers and rural families across this great nation.
In preparing for this presentation, I realized more than ever the tremendous scope of the issues that this Senate committee is tackling. It was then that I put on one of my many other hats, that of Chairman of the Municipality of Powassan Economic Development Committee, which we proudly and fondly call MoPED. I invited my mayor, Mr. Bob Young, and some of his mayoral colleagues to be a part of the opportunity to provide input to the Senate report on behalf of the citizens of the Almaguin region of Ontario, which stretches from Huntsville in the south to North Bay, some 120 kilometres further up the road.
Our fundamental message today is simple. We need a long-term rural policy in Canada; a recognition of the importance of an economically healthy rural community across Canada; an economy that creates opportunity for individuals to create their own wealth; and a vision similar to the national dream that built the railway from coast to coast. That railroad helped to establish these hundreds of small, rural communities whose lack of sustainability and their very future we are despairing of here today.
We need to address the paradigm shifts and our seeming inability to cope with the demographic and social changes that have left rural people as the proverbial poor cousins of city dwellers. The municipality of Powassan and the neighbouring villages and communities are only a microcosm of our nation's rural revolution these past hundred years.
Towns of Powassan and Trout Creek, which make up the urban centres of our municipality, were built on the coming of the railroad in the late 1890s. The railroad was followed quickly by sawmills, logging and agriculture as pioneers came in and cleared the land, as happened in hundreds of small communities across Ontario.
Until the late 1970s, Powassan was a thriving agriculture town with farm dealerships, hardware stores and welding shops driving the local economy and serving over 80 dairy farms and other farms in the immediate area. High interest rates of the early 1980s, galloping inflation and various farm crises and changing practices took its toll on the entire rural economy. I leave it to current farm leaders to expand on agricultural policy options.
Suffice for me to say that our rural communities did not adapt well to this paradigm shift that eroded the wealth of the countryside. Frankly, we feel it has been a slow quiet passage, barely noticed by the casual observer. After all, farms are still there and the locals still call our area a farming area, but the 80 dairy farms are now down to eight, pleasure horses have replaced the cattle, the fences and barns are decaying, and many of our pioneer family farms are now rural residences for commuters who go to work in the city of North Bay some 20 miles up a new four-lane highway. The real change we see in our municipality is on the main street where we have empty store fronts and empty parking spaces.
The willingness to adapt to change and seize 21st century opportunities is the challenge rural folks face. Providing the tools and a sound long-term rural policy is the role you face here in Ottawa and in government.
I must impart my personal experience of these past few years as a means of conveying my message today. When I retired as president of the Ontario Federation of Agriculture, I bought a century-old hotel on Powassan's main street. We rejuvenated the old building only to see changing social trends, changing demographics, government regulation and a whole bunch of other things make it economically unviable to the point where that business is now closed and probably will meet the wrecker's ball in short order.
Today in my speeches, I tell audiences that every farm leader should own a business on main street to understand better the forces that impact upon the whole rural community and not only on agriculture, the social fabric that affects our local communities and economies.
A happier chapter in the last 10 years was my role in helping to create Canada's Agricultural Adaptation Council in 1996. I was the founding chair of the Ontario's Agricultural Adaptation Council which has, in partnership with the federal government, funded over 2,000 projects across Ontario. Those projects have helped the agri-food sector create new opportunity, new products and new wealth in response to change and opportunity. The Government of Canada, at that point in time, stepped outside the bureaucratic boundaries and constraints in 1996 and gave these councils and the farm leaders who sit on them the latitude to be innovative and bold.
Today I again had the chance to meet former minister Ralph Goodale who I negotiated these deals with. I congratulated him on his vision because that is the kind of vision we need today to break outside that bureaucratic box. I urge this principle be maintained and broadened to other applications. Only by combining risk with vision can new wealth be created.
Our international competitors have made these plans and have the long-term government commitment and budgets to bring them to fruition. It is not good enough to shift policy every time we change a government or minister. At the least, we must look at the European Union's new commitment to rurality and we must have a rural secretariat in Canada with the right funding and the right long-term strategy.
In 2001, Ontario farm leaders invited me to chair a forward-looking working group that we call the Odyssey group. The Odyssey Report of 2002, which was tabled with the clerk, addressed a range of issues that agriculture and rural Ontario must address in the next five to 10 years, like it or not. We offer policy options based on a worldwide search tour of Europe. It is there we found rural policy that profoundly influenced our thinking and changed my thinking as a former farm leader. I hope we can follow up on these issues during the question period. I can advise you more on any of those profound topics.
All these problems eventually trickle down to our small municipalities. Mayor Young is in the unenviable position of having to tax his neighbours. He taxes his neighbours and friends he sees everyday on the streets. It has taken a leap of faith today for my municipality to hire a full-time economic development officer for our 3,200 rate payers. We are in the minority, as a small community, to have a full-time economic development person. The original funding came from the Federal Economic Development Initiative of Northern Ontario, FEDNOR, for which we are grateful, but all too often seed money is wasted because the programs are cut off before the seed can bear fruit.
Today, I am proud that we have our economic development officer here. Andrew Busch is in the public gallery. He is our investment in the future because we know the sort of work he will do. The research he can do on a professional basis will eventually bring us economic growth and create new rural wealth. We urge the government to offer rural municipalities stable funding so we can afford to have professional staff beyond a 12-month internship.
With all due respect to my mayor, the economic issue we have before us is too important to leave to part-time people, volunteers such as myself who chair the economic development group, and also our overburdened municipal clerk. It simply is pushed into a secondary portfolio.
University of Guelph Professor David Douglas has research links that will tie full-time professional economic expertise on staff to economic growth within that rural community.
I know you have had difficulty in defining rural poverty, but we see the financial burdens placed on our municipalities as draining away wealth from our residences. The burdens do not leave the municipalities in poverty, but they certainly bring down our net worth and our ability to spend money on other things.
For example, Powassan is facing a $2.5-million water upgrade that must be borne by less than 500 homes and we have yet to bite the bullet on an equally costly sewer upgrade, not to mention roads and bridges. There is only one municipal taxpayer and our property taxes alone cannot sustain these increasing costs. Today in Ottawa we have been using our opportunity to meet with politicians and senior bureaucrats to talk about these issues.
Our neighbouring rural municipality of Chisholm must replace several bridges. The cost of the concrete and steel is dwarfed by engineers' costs and environmental permits. As Mayor Young likes to say, it costs $400,000 to cross a puddle-jump of a stream that farmers used build in a week, 40 or 50 years ago, in lieu of taxes. Where have we gone with these extraordinary costs we are imposing on rural residents through the tax system to replace the infrastructure?
The shared Canada-Ontario Municipal Rural Infrastructure Fund, COMRIF, has proven to be nothing but a lottery for many small municipalities. Infrastructure demands of rural areas, many of which are mandated by legislation, are bleeding our municipal coffers and straining the financial resources of our residents.
In allocating funding, we could accuse governments of political patronage, but we prefer to ask that such major infrastructure programs are part of an overall rural strategy. Whatever new funding was approved in the recent budget, we hope there will be better, more equitable rules in place in the next six months before that funding is cast in stone and becomes a political game once again.
In Powassan, we have spent tens of thousands of dollars to hire consultants and engineers to fill in complex application forms before we can even apply for these grants. That funding is an expensive lottery ticket. I told Mayor Young that we might be better off to buy the real lottery ticket rather than to buy the lottery ticket for these COMRIF programs; we have bought three so far for $20,000 and we have not won yet.
Volunteers are a great asset also. They are the ones who fund our food banks and organize our festivals, sports events and countless other things locally. Volunteers are harder to find these days, in part due to a social shift; but it is also an issue of frustration, with simple fundraising raffles, bingos and other things falling under the Criminal Code of Canada now.
Part of the issue is Ontario government regulation. Our volunteers, many of whom are elderly people or retired people, question why they cannot have simple raffles anymore without filling out a mountain of forms with the municipal clerk and paying licence fees. All they are trying to do is raise a couple of thousand dollars to send somebody off to a Girl Guide camp. At the moment, for example, we are trying to raise funds for a boy that is likely to be a paraplegic after an accident at the school. We run into all these strange rules where we cannot do the things we used to be able to do.
Also, the threat of frivolous lawsuits today affects many attempts to hold events and use our rural assets for the greater benefit of society. Insurance rates, which protect our municipalities, have been driven sky high by lawsuits because the municipality holds the big policy. Canadian negligence law needs to be amended so we can eliminate this business where a person with only 2 or 3 per cent of the blame can end up paying 100 per cent of the claim, thus driving up insurance rates — again paid for by the taxpayer. We need to look at the federal Negligence Act, in concert with the insurance people. That act is far too complicated for me to understand, but it is a big deal.
Another key thing is that in dealing with environmental issues, the Government of Canada now has the opportunity to reward rural people for protecting wildlife. The government could pay for public use of private lands and reward those whose land is a buffer to ensure clean water. Instead, we still seem to have this bureaucratic regulatory mentality where we legislate instead of partner.
Ontario agriculture's Environmental Farm Plans are bold, innovative and effective strategies that were created by farm leaders to avoid being legislated. The programs have been world-leading ones.
Some landowners also need to wrap their heads around the fact that their land may be used better for other options than direct farming. We saw in Denmark and Europe that birdwatching might be a far better income than growing corn. The imagination is all that restricts us as we move forward into this millennium, to look at the opportunities in rural Canada to create new wealth around renewable energy, biofuels and environmental sustainability.
Finally, I want to broach the topic of finance. Canada ranks poorly as a venture capital nation. I have been involved in efforts to bring a vodka distillery to Cochrane, in Northern Ontario, which would have been the hub of a multi-million dollar agricultural cluster project. The project continues to be stalled because we cannot find $2 million or $3 million of venture capital to go with other funding already in place.
Credit is a coward. Our local bank might finance a $40,000 SUV for me, but it will not finance the stock to put into a little store that I may want to open on the main street in my town of Powassan. That has been difficult.
We believe that in any changes that might be contemplated by the Government of Canada, the Bank Act should be linked to a condition that these big banks that want to be global bankers in competing with the Bank of Japan and the Bank of America are required by law, through changes in the Bank Act, to place a certain part of their portfolio into investing, along with entrepreneurs, in the rural communities. Perhaps they could offer micro loans, or whatever it takes there, to help spur on small business in our rural communities — because most of these businesses are small.
The issues involved in your studies are boundless, but the focus must be on this dedicated, long-term approach to Canada's rural economic and social fabric. Reality in all its forms must be a priority for Canada. The countryside was hacked from the forests and malarial swamps by our ancestors. As we rightly honour our veterans, so should we uphold the dream of the founding pioneers by rededicating our commitment to rural people.
Madame chairman, the scope of our vision today will determine the size of our wallets tomorrow.
The Chairman: Thank you for your generous description of where things are. It is real, and we are glad you came.
Senator Segal: Thank you both for making yourselves available and giving us the benefit of your advice and counsel.
One great challenge in government is, do we have programs that fund people or do we have programs that fund places. There is a long history in Canada of great battles over how we divide up our money, place by place.
In some countries, the battle has always been on public policy — who, what, when, where and why. In Canada, the debate has always been about where. Where do we build that aircraft; where do we build those ships; and where do we invest in this pipeline?
The debate raises questions about the viability of communities. We have been to small communities as a committee. We were in an Ontario community not long ago that had a population of 1,100 — Athens, a wonderful place. It is the home of Loyal Orange Lodge No. 1, I hasten to add, for historical perspective.
Athens survives economically in some measure because it is located between Smiths Falls, Ottawa and Brockville. There is a lot of traffic and it is a bit of a bedroom suburb. A population of 1200 would not be a sufficient base to meet its obligations for the municipal services you laid out in your presentation. Is 3,300, in your judgement, a sufficient tax base to meet the legitimate obligations you have laid out, relative to sewer and water?
If not, does that mean that the taxpayer in Toronto and Vancouver should pay more taxes so you can have a new sewer system where you have chosen to live? I am being provocative here. Might the taxpayer in Toronto or Ottawa say, we moved here to find work and maybe those people who want to live in Powassan need to make some tough economic decisions?
My bias is that we should invest in Powassan. We should find ways to put government back-office departments in Powassan with 300, 400 or 500 good jobs as part of the economic base. We should make sure the telephone companies put a broad band connection into Powassan to help with business and technology. We should do all the things that are on your list.
Having said all that, how do we move government from where we are now? Canada is the most urbanized country in the world, except for Australia. There is a reason for that. Canadians have voted with their feet about where they want to find work. How do you bridge that gap?
Bob Young, Mayor, Municipality of Powassan: I think you are asking who should pay here. I believe we all pay, whether it is through income taxes, employment taxes or whatever tax. There are a number of taxes we can deal with. As taxpayers, we all have an obligation to create the wealth within our country.
I believe all levels of government should be a partner — federally, provincially and municipally — much as we have experienced in the past through commerce, et cetera. I believe we all have an obligation as taxpayers to contribute.
Senator Segal: Mr. George made reference in his presentation to the regulatory burden. If I follow your logic, what I thought I heard you say is that whatever the rules are for a lottery in downtown Toronto, they should be less strict in Powassan. Whatever the rules are for building a bridge in downtown everywhere should be less onerous in Powassan. Is the answer because Powassan is smaller, or do people of Powassan not have the right to the same standard of safety and protection because they are in a small town? I want you to help me follow that logic through.
Mr. George: Part of our argument is the additional costs, such as engineering fees and obtaining the applications, which add greatly to the cost of the bridge. We have no problem putting enough concrete and steel into our bridges. Those items are not the major cost at the moment of building a bridge. Environmental issues cost an awful lot of money. If we can find a way to bring these infrastructure costs down, that is almost as good as receiving a grant. We would like to save $100,000 on the soft costs. That is what we look at.
We are not looking to reduce standards here.
Senator Segal: Bureaucratic costs are not easily borne by smaller communities. When the duty to provide that information is placed on a small community, it is legitimate for the province or the federal government to provide subsidies so the cost is manageable without reducing the actual standard of safety in the community.
Mr. George: True, the City of Toronto has countless engineers on staff to do their work. We hire our engineers at $150 an hour or whatever it is.
Senator Segal: Right.
Thank you, Chair.
Senator St. Germain: Thank you gentlemen for appearing, and for an excellent presentation, sir.
Senator Segal touched on my concern, which is the bureaucratic costs that have arisen as a result of environmental issues and lawsuits that are waiting to happen. I live on a farm and city dwellers tell me I should do this and that with my land as they pollute the living daylights out of everything with about three cars each. They have blacktopped everything and they have dumped sewage into the bay and into Victoria and everything.
Yet, there seems to be an onus of responsibility, environmentally and otherwise. Years ago when I grew up in rural Manitoba, the farmers built a bridge and it worked.
I think Senator Segal asked you this question. I do not know how we go about differentiating from the rural people. As you point out, Toronto has hundreds of engineers sitting there waiting to do something. In the case of a small community, you must go out and hire somebody. I do not think you will hire them at $150 an hour. Do you see a rural and a city standard being able to coexist?
Mr. Young: I believe so. We will use Canada-Ontario Municipal Rural Infrastructure Fund as an example of a funding formula. We are not on a level playing field with Mississauga or Chatham. We are 3,200 people, but when applying for funding on a comparable scale, we are under the same rules as they are. We certainly can coexist, but there have to be different funding formulas for smaller and larger municipalities. I hope that answers your question.
Senator St. Germain: Where should that money come from, gentlemen?
Mr. Young: It should come from all levels of government. We all must be partners in everything we do when it comes to funding infrastructure projects of any sort. I have no problem paying our fair share. I believe the one-third formula that has been used in the past is fair.
Senator St. Germain: What did you find in Europe? They receive larger subsidies, if I am correct. You tell me, Mr. George, exactly what you found there. How do they maintain their rural lifestyle?
Mr. George: The current agriculture policy is somewhere in the region of 45 billion euros a year. I stand to be corrected on that number. The subsidies are big dollars. They are switching away gradually from direct agriculture subsidies. We all remember the mountains of surpluses created, and the terrible distortions worldwide that they caused over the last 20 or 30 years.
The European community has finally come to its senses and is shifting its commitment from agriculture into rurality. They are engaging farmers and all rural businesses to protect the countryside and develop the rural economy. They have not cut back. They have fully increased their gross commitment, which used to be a direct agriculture subsidy. That commitment is now to rural Europe.
That is a fantastic thing. That is what we have to do. I believe that. Just as we need to make huge commitments to the environment and climate change or whatever, let us involve the landowners in that. Let us involve the rural business owners. That involvement will be part of a growth centre, the new economy that will use these dollars that the public will invest. This investment will keep our rural communities strong.
I can give countless examples in Europe of the shifts such as planting trees. They ripped up all the hedges, and goodness knows what, and wondered where all the birds went. The birds are coming back. There are 5 million birdwatchers in Europe alone. It is a huge business. Farmers can make money by renting out part of their operation. In Denmark, a fellow spent $30,000 to build an observation tower. It was the best investment he ever made.
Senator St. Germain: I have a short supplementary question and you can come and watch birds at my place. Geographically the expanse of this country is huge when compared to Europe. Do you think that expanse minimizes the ability to enact what the Europeans have?
Mr. George: No, I do not. Nothing could be more complicated than a European community with 20-odd nations. As complicated as our governance system becomes from time to time, it cannot possibly be any worse than trying to make the European Union work. I do not say they have it right, but I think they are ahead of us with long-term strategic thinking. One thing that impressed me in Denmark is where the Deputy Minister of Agriculture told us they have 30- to 40-year-old policies that transcend any government change. Those policies deal with environmental things. Look at Denmark today. It is an amazing place from an environmental and agricultural point of view.
Senator Callbeck: Thank you for coming this evening and for your presentation. I am from Prince Edward Island. When I listen to you describe what has happened to your area in the last 30 or 40 years, it sounds familiar to me. That is exactly what has taken place in many parts of my province.
I wanted to ask you about amalgamation. Witnesses have talked about smaller areas coming together, pooling their resources and providing more benefits. You have gone through amalgamation. I would like to hear your comments. Has it benefited your entire area?
Mr. Young: From our perspective, yes, it has benefitted our region. We had three separate municipalities within one boundary — the Township of Himsworth South. Within that township, we had two urban municipalities. We went from three governments to one, streamlined the process and realized a definite cost savings when we pooled our equipment resources in public works and amalgamated our government offices. We have a much better government than we had seven years ago.
Senator Callbeck: Would you agree with the witnesses who came before you and said the same thing — amalgamation brought benefits to smaller areas?
Mr. Young: In some areas, yes, it would provide benefits but I will not suggest that it works in all cases. It depends on the locality of the communities and what they have in common. We need to consider many factors. We had shared services previous to amalgamation so it has worked nicely for us, although some might not agree.
Senator Callbeck: Do you have an economic development officer? Was that position created with the amalgamation?
Mr. George: Mr. Andrew Busch, who is in the public gallery here, has been the economic development officer for less than two years, having begun with an internship of one year. I give a lot of credit to our municipality because with such an intern in place, we were able to see the benefits of having a professional on staff. Such positions do not come about easily and quickly. Only recently, council made this position full-time, which was a brave move, given the council's tight budget.
We are looking at Mr. Busch in that position as a long-term investment because we know that having a professional person on staff takes a great deal of pressure off the volunteers and the part-time council members. He is able to meet with other economic development officers and look after business applications. As the mayor will tell the committee, some major investments have happened during the last two years in our municipality. Perhaps Mayor Young would talk about the horse issue.
Mr. Young: Yes: A couple from North Bay came to our municipality to buy a 100-acre property that was a former horse-housing facility. Since they purchased it, they have expanded the facility to the tune of well over $1 million in buildings, horse rings and so on. They held a Trillium show this past summer, which was the first in North Ontario. Their work has opened the eyes of not only our residents but those of the entire area to the potential for equestrian economic development. That was unheard of in Northern Ontario before. It is been a great boon to our municipality.
Senator Callbeck: What other projects is the economic development officer working on?
Mr. George: We are working hard to bring small business to the area. The committee that I chair was advised not long ago that we should bring in businesses one at a time, which means two jobs here or three jobs there. We have a few commercial facilities where three or four businesses have started up over the last 12 months. That development is huge by our standards. Ten jobs in Powassan likely equate to 500 or 1,000 jobs in Toronto so the economic development is significant.
Much of this growth has happened because we have an economic development officer and we are developing the culture within municipal leadership to think long-term. Recently, we prepared a strategic plan, which is the first one that our municipality has ever done. Already it is providing guidance for our planning for the future and, provided we can see our way to fund the activities, eventually it will pay dividends.
Frankly, we are pitching to healthy seniors because we know our demographics and that we are only three hours north of Toronto. Soon, we will have a four-lane highway right to Toronto. We have heard about people considering selling their $600,000 houses in Toronto so they can buy a heck of a place on 10 acres of land with all the toys they need in Powassan. We could become the next Muskoka Lakes region in the next 20 years, if we can build the right base now.
Senator Callbeck: I would like to ask about immigrants to the area in consideration of your comment about planning for the long term. Are you thinking of attracting immigrants? In my province of Prince Edward Island, there is a population problem so we are trying various ways to encourage people to settle and stay.
Mr. Young: We are fortunate that a number of Amish have moved to a neighbouring municipality on our boundary. I do not know how many families there are but there must be at least 10 or 12, and we understand that more are coming. Obviously, they have been a wonderful asset to our community because they are builders and farmers.
Senator Zimmer: Relating to Senator Callbeck's question about the businesses in your area, I understand from the information on your website that you have a strong recreational capacity whereby you offer skiing and interpretive trails. Have you marketed that asset to encourage the development of the tourist industry? Have you been able to capitalize on that market?
Mr. George: We have not been able to do the kind of marketing that we need to do. To market any area, certainly outside our immediate boundaries, is extremely expensive. However, in combination with about 15 municipalities to the south and north of us, we are attempting to create a "Market Almaguin," whereby we could increase the financial resources from Powassan's $10,000 to a multi-municipality fund of $150,000 for such programs. Those efforts are underway but they are in the early stages. It is difficult to reach consensus on such a mindset.
We need to have something solid to market so we are developing a plan. One idea is to build a public observatory for astronomical viewing in the southern part of our municipality. If we can pull it off, it could become a destination attraction. Our original dream is to build something that will complement Science North in Sudbury and the polar bears in Cochrane. If we can do it that way and have a steady block of tourist attractions every 50 kilometres up Highway 11, you can be sure that those people, after they have been to our public observatory, will be inclined to move up the road. They will shop in North Bay and travel to Timmins to see Shania Twain Place and end up in Cochrane to look at the polar bears. The tourist route becomes an entire corridor of attractions. However, it takes a great deal of planning, and such attractions are expensive to develop. Certainly, FEDNOR, a federal regional development organization in Ontario under Industry Canada, is helpful in advising us on those matters.
Senator Zimmer: I wish you the very best.
Senator Mahovlich: Thank you, gentlemen, for appearing before the committee today. I have been to Europe many times, and travelled through France, where their farms are beautiful and their rural areas are more populated. Lyons, France, has a population of 500,000 and is surrounded by farms that are old. Do you think we are too hard on ourselves or too critical of ourselves? I agree that we need to plan but we are on the right track.
Mr. George: Are you talking about being on the right track with agriculture or with rural policy?
Senator Mahovlich: This country is still developing its agriculture and rural policy. Many towns we visited had populations of only 1,000 to 2,000. They are working hard and have set up a community centre and a girls' hockey school in a small western town of maybe 2,000 people. Everyone is excited about it. Canada is doing well for its size and its young age.
Nîmes, France, just below Lyons, is a Roman town. We are talking 2,000 years of history. In 2,000 years, we will have a lot of problems solved.
Mr. George: I cannot wait 2,000 years, senator.
Senator Mahovlich: I am saying that we are very critical of ourselves, yet we are such a young country. It takes time to develop this.
Mr. George: The grammar school I went to in England dates back to 1291. It got its royal charter from Queen Elizabeth I in 1560, so there is a lot of history there. Canada, however, is in a world market. Evolution was fine for the last 100 years, but the world has changed and these very people that you cite are intense global competitors.
We are going to get killed out there on this rural market. If we had the old traditional markets, where we thought we were the bread basket of the world, that is one thing, but it is a whole new world and has been for the last 30 years or more. I think the difficulty we face is that we are not moving fast enough to adapt to that new world. I am suggesting that we put in place fairly quickly some long-term rural policies that will put us on that same playing field. It is not necessarily giving billion-dollar bailouts to agriculture all the time.
Senator Gustafson and I have been down this road a couple of times. I am not sure we are necessarily serving the country well by not rethinking some of our agricultural policies.
Senator Mahovlich: When I was travelling through Portugal last year, I was amazed at the bridges that have been built. They attract a lot of tourists. Driving around Portugal is very easy. They have Golden Gate-type bridges across some of their rivers. They are very beautiful. How did Portugal afford to build those bridges?
Mr. George: I do not see any tourists coming to see our $400,000 bridge in Trout Creek.
Mr. Young: $4 million.
Senator Mahovlich: There is a pretty good highway up there. Mr. Harris built that four-lane highway all the way up to North Bay.
Mr. George: He did not finish it, though.
Mr. Young: They probably did not have to deal with Oceans and Fisheries the way we have to deal with them when we cross streams in this country.
Mr. George: We have been admiring the wonderful buildings here on Parliament Hill. Can you imagine building Parliament Hill today?
You ask how these things get done. Of course, these things get done. We would not be building cathedrals in England today, either. Those things got done in a different era. We are now in an era where we have to address these rural issues totally differently. We can no longer say that we will leave the peasants and stone masons to build these wonderful bridges.
If you want to give farmers the mandate to stop growing corn and to build bridges, I am sure they will do it, and they will do it for a lot less than the engineers are charging us. We are in a different era now. We need totally different types of policies.
Senator Mahovlich: More committees.
Mr. George: Committees? This is a great committee, but I would not say all committees are great.
Senator Gustafson: I will use an old line that I have used many times: We are in a different political situation — and I am not talking about Liberal or Conservative — that is, the politics of what is happening, of centralizing everything in urban centres. This is a growing phenomenon.
Yet, coming out of rural Canada, we have fisheries and forestry — which is bigger than grain; it is a big industry. There is agriculture, grain, oil and gas. Incidentally, I was reading in the paper today that the Enbridge pipeline, which flows 400,000 barrels per day, sprung a leak out in our country today. Potash, mining, uranium, diamond mines, the environment, livestock all come out of rural Canada.
Under our political system and the centralization that is there, not enough is going back to the rural areas. We need to find a different formula to deal with the situation.
Farms are getting bigger and will continue to grow unless we find an answer to these problems.
Mr. George: You are absolutely right, senator. Just as we have had paradigm shifts in rural communities, we need some paradigm shifts in politics, too. This global warming business might be the answer if we do it right. We have a real problem. We have a huge paradigm shift in the weather and in environmental thinking.
Politically, we need to build on those opportunities. It looks to be a bad news story on the outside and it could be a real problem, but we could actually capitalize on it, certainly in rural areas. We have that land mass that is going to provide the clean water and filter and protect all the water sources. We also have those raw materials and resources, the trees, the grains. We could produce biofuels. We could be using our manure for biogas. There are all sorts of things we can be doing if we make that commitment, but it cannot just be a three- or four-year deal. It has to be a long-term deal. I am waiting for this committee and for some government to come along and cast in stone, just like we cast in stone our military, our health, our education, that rural Canada is a fundamental part of this country.
Senator Gustafson: This committee has suggested, over the last couple of years, a Canadian farm bill that projects maybe 10 to 15 years into the future so that we have some idea of where we are going as opposed to the ad hoc programs that try to save us for another day.
Mr. George: I could not agree more.
Senator Mercer: I was interested in your comment about your economic development officer; he was an intern sponsored by FEDNOR, if I heard you correctly.
Let us talk about FEDNOR. The current government is not a huge supporter of regional economic development agencies such as FEDNOR, ACOA or Western Diversification. In your estimation, as an administrator and politician from Northern Ontario, is FEDNOR doing good work? Obviously, there are criticisms that you will have, but I want to talk about this in general terms.
Mr. Young: From our perspective in Powassan, we do not have a criticism of FEDNOR. They have been a great partner for us, not only for the internship for the economic development officer, but also for strategic planning and other projects. They have always been there and been very supportive of anything that we have asked for. FEDNOR has been very, very good for us.
Senator Mercer: Excellent.
The current government has put in place a program for child care where they pay $100 per month per child in a certain qualifying range. Has that program worked in your area? Has it helped to create any more child care spaces?
Mr. Young: From my knowledge of child care spaces, they are to capacity now; I do not think the program has created more spaces. What we have is there, and they are to capacity.
Senator Mercer: Municipal politicians experience frustration in applying for programs; every year they have to reapply, revise everything they do, and every year they have to hire, say, another engineering firm to rework the same documents that were presented the year before. Has there been any improvement in Ontario on this over the past number of years?
Ontario is probably a good petri dish to look at this from a political point of view. Over the past 15 years, we have had Liberal governments, Conservative governments, New Democrat governments, and now we are back to another Liberal government. Has there been any improvement? I am trying to depoliticize it to see if any of us know what we are doing.
Mr. Young: I can comment on the latest COMRIF round. Obviously, as Mr. George touched on earlier, the fund is nothing more than an expensive lottery. The process was far too complicated; the application form was too complicated. You had to buy the lottery ticket — incur the expense of an engineer or a consultant to do the application — when, in a lot of cases, there was very little hope of getting the funding.
Over the last few months, there was the provincial government Rural Infrastructure Investment Initiative, which was a very simple process. Funding up to 100 per cent of a project was available, as long as it was engineer-ready. That is the type of funding we would like to see — simple and easily accessible — where you do not need an engineer or a consultant to fill in the application.
The process should be nothing different than a mortgage application. If an individual has his or her share of the down payment for a mortgage, usually the person can get the mortgage. It should be no different with federal and provincial funding. If the funding is there and you have your share, there should be very few restrictions.
Senator Mercer: It seems to be improving, is that what you are saying?
Mr. Young: On the provincial side, it has with this latest round of the Rural Infrastructure Investment Initiative. I do not want to get too deeply into the COMRIF because it is not a good spot in my heart. Obviously, I did not like it because we failed three times.
Senator St. Germain: The mortgage analogy is a good one. It is an excellent idea that the bureaucrats should start thinking of, because the CAIS program and all the other programs are so complex.
The Chairman: We can mark that down for the next report.
Senator Oliver: You said, Mr. George, that in your community there used to be 80 working dairy farms but that there are eight presently. I am very interested to know what happened to the other 72. You gave one example of a very successful investment in a horse farm, but what happened to the other 72, in terms of economic activity? Are they vacant?
Mr. George: The farms are still there; nobody took the land away. In some cases, once viable family farms are turned into residences for commuters. In some cases, the farms have been subdivided somewhat. The original attempt from retired dairy farmers was to move into the beef business. We all know that that has not been a particularly profitable venture in the last 20 or 30 years, if it ever was.
There is no serious large-scale agriculture left — having said that, however, ere are many part-time farmers. We all know that most of the farm income is coming from off-farm anyway. We have that scenario.
The farms are still there in different forms. The key thing is that we have people on those farms and they are custodians of the land. In Ontario, there are 14 million acres of farmland, one way or the other. Whoever is on there, whether it is a full-time farmer, a hobby farmer, a part-time farmer or commuter, they are still custodians of that land. They have the responsibility, given them by society and rightfully so, to safeguard the environment.
We have an opportunity here to use those landowners, whatever they want to call themselves, to ensure that the future of the climate, the economy and the environment is safeguarded. That is the big shift we have.
Senator Zimmer: I was born and raised in a small farming community in Saskatchewan and I now represent Winnipeg in the Senate. A few weeks ago, I was not a regular member of this committee, but I had the opportunity, invited by the chair, to go to Steinbach, a thriving community in Manitoba.
We heard from Robert Annis, the director of rural development at Brandon University, and he recommended that federal, provincial and municipal governments work together. He also stressed that rural and northern poverty is not solely the responsibility of any single level of government or department. The Odyssey report seems to echo that sentiment, as it highlights the importance of the government reinvesting in the agri-food sector.
What is your vision for the future involvement of governments at this level for the revival of this sector, taking into account the fact of climate change, which you also touched upon? It may not be exclusively negative. The increase in carbon dioxide may yield increases in the forestry and agriculture sectors. New crops may emerge from that, and there may be a northern extension of agricultural land that has not been taken into consideration.
Do you believe we must prepare for these advantages? How do you think we can do that in your community, involving all three levels of government?
Mr. George: You are right about the partnerships. Whatever we do in this day and age should be focused on partnerships. One of the things I have been harping on to my former farm leader colleagues is their failure to partner with the rest of the food industry. We tend to be very good at growing crops but very poor at marketing them. I suspect that Loblaws and Sobeys in Ontario have far more impact on agri-food than do the farm organizations and farmers. We have to work our way up the chain and make those partnerships and deals with the food processors. Perhaps we should go into some long-term contracts, making sure we get a fair share.
If I am supplying parts to General Motors, I will ensure my parts are priced to make a profit. If I am supplying quality food to a processor or to Loblaws, I want to make sure I get the right price for that. That is one area in the marketing where we have failed miserably.
As I told a vice-president of Loblaws when we were researching our Odyssey report, you better be prepared to pay farmers to safeguard traceability on food. Your ability to access a commodity that you know has been grown under some of the strictest standards in the world is the best way of protecting that President's Choice name. You have hundreds of millions of dollars invested in that brand name. Rather than buy something that is floating around on a ship in the Pacific because it is 10 cents a bushel cheaper, you had best be buying it from a jurisdiction such as Canada, where you know those commodities are grown under the best conditions.
However, do not ask my farmers to have all these extra costs of producing those goods under that typing unless you are going to pay for them. If it is for the safety of consumers, then somewhere along the line consumers will have to pay toward their share of safeguarding that food supply. That is a big deal for Canadians today when we are health conscious and careful.
One good thing that came out of the BSE scenario is that it told farmers about the importance of traceability. If we had not been able to trace those cows, the beef industry would be shut down to this day. Therefore, we must stay on the leading edge on all these things, whether it is agriculture, environment or something else. We have to be the best, or at least equal to the best in the world. Otherwise, we will go nowhere. Rural policy has to be among the best in the world.
Senator Gustafson: I will read a poem; however, I did not write it:
The farmers feed them all
the politician talks and talks
the actors play their part
the soldiers glitter in parade
the goldsmith plies his art
the scientist pursues his germ or terrestrial ball
the sailor navigates his ship
but the farmers feeds them all
the workman wields his shiny tools
the merchant shows his wares
the astronaut above the cloud a dizzy journey dares
but art and science soon would fade and commerce dead would fall
if the farmer ceased to reap and sew
for the farmer feeds them all.
The Chairman: Thank you very much. We will get that in the report.
Senator Segal: We have the lyric; we still have to hear the tune.
Can I ask our guests to get into something that is more nitty-gritty, something this committee has been focussing? What percentage of Powassan's 3,300 population is living beneath the poverty line? Between 11 per cent and 16 per cent of our fellow Canadians live beneath the poverty line. The number in rural Canada is worse. I wonder what your sense is in your own community.
Mr. George: I have not seen the 2006 census statistics yet, but in 2001 Powassan ranked considerably below the net incomes for Ontario. We were probably lower than even some of our neighbouring municipalities.
Senator Segal: I noticed in some of the recommendations associated with your Odyssey report that there was talk about a more dependable long-term approach to commodity cycle support. I have asked many of our witnesses this question, so I want to get the benefit of your advice on the same issue. When we have commodity-based support programs for farms, there are boom and bust cycles. The bureaucracy is associated with getting grants in a timely manner to people in difficulty. When we talk about the auto industry, we talk about a very generous employment insurance program financed by the auto workers themselves, by the employers and by the federal government. When auto plants are shut down, by and large those workers are paid a much higher level of employment benefits, because it is in everybody's strategic interests to keep those employees there when the plants start up again and the cycle comes around.
We had a representation from an OFA president in Athens, Ontario, who said that he was unsupportive of that basic income support for farmers. That was somehow an admission of defeat. Rather than have a basic income floor that people could depend on, good times or bad, because everybody has the right to the basic requirements for a decent life of food, shelter heat and clothing, he was very much of the view that we should stick to that commodity-centred approach and not support rural and farming people with a basic income floor as is being considered in other parts of society. I would be interested in your perspective on that, knowing your community as well as you do.
Mr. George: If I put on my old hat as a farm leader, as a leader of Ontario's 40,000 or 50,000 farmers, I was committed to commodity-based support. However, in retirement and upon reflection, I see different ways of doing it. We have seen European examples of directly supporting commodities.
In answer to this issue of how you deal with auto workers when the plant gets closed down or there is a temporary setback, most farmers do not get employment insurance. What they do, probably before even getting to the stage of getting rid of livestock, is go out and get other part-time jobs, along with the rest of the family. We have seen the statistics that indicate that 80 per cent of farm income is coming from non-farm sources.
Certainly Ontario, with its ability to offer jobs in urban centres, is better suited than many provinces. This is certainly better than in Senator Gustafson's province, for people to have work in a plant. We can go to North Bay, 25 miles up the road, to find jobs. That is what we do. They may still be on the farm, but that farm is doing nothing for them financially. Nevertheless, it is a great place to live; they are very happy to trade that off.
At the same time, I get back to what I have been harping on all night about using that land base these people own, to help general society.
Senator Segal: Mr. George, when we say we want to support rurality, we say we want to pay farmers and people who live in rural areas to help us mind our watersheds, to protect the land and to help protect the forest. The OPP is concerned there may be as many as 20,000 illegal grow ops across the province. Because the areas are depopulating, there is no one to report on strangers in town. That is a problem. When you put all those numbers together, are you not talking about a basic income floor that says, because you live where you live, because you are doing important things for the community as a whole, we will find a series of ways to get a basic income floor to you, irrespective of whether the farm made money? We prefer it does make money and we would be happier if we all would, but if it does not make money, we do not want you to fall beneath a certain level because you are our fellow Ontarians and Canadians and there should be room at the family table for everybody. Does that trouble you?
Mr. George: No, it does not trouble me, and I am surprised that it troubled the president of the Ontario Federation of Agriculture. As I say, I have seen the evolution in Europe. Many of my good friends when I left there were major commercial farmers and have switched. Farming, while still important, it is not necessary their main income centre. They are into the tourism business and the use of their resources. Maybe they have streams for fishing or whatever, they are into trails, but the public is paying there, either as individuals or through the public purse. We are paying people in Europe to safeguard that land.
Quite frankly, I do not care where my income comes from on the farm. My strip of land down the line fence may get me more money growing corn or because I have a snow mobile or an ATV trail down there. Quite frankly, I will take the cash.
Senator Gustafson: A quick supplementary. General Motors is supposed to be paying $2,700 on every car they sell just to pay the pensions built up throughout the years. They have a pension and a guaranteed income. A farmer does not. If he can build up his farm and sell it off and retire from what he has built up, that is all he has. It worked for General Motors. Maybe it has not. I do not know. Certainly that is the way it works. They get their pension and they are guaranteed. From that point, it is a retirement. I have nothing against that, but a farmer does not have that.
Mr. George: As you said, he has the opportunity to capitalize on the equity he has built up. The sad part about that is that in most cases the equity the farmer has is not from money they made from growing crops year to year or selling livestock. It is due to inflation in land or quota prices. Most of the 80 dairy farmers we have lost in our area of the world have at various times come out with a significant amount of money for quota values and in some cases land appreciation. It was more than the land value when they got it for nothing when they settled.
Senator Gustafson: By your own witness, you suggest the farmers have done this with off-farm income. They have to work 16 or 18 hours a day to do that. They work the farm, work the oil fields, then go back at 5 o'clock at night and start farming until midnight.
Mr. George: No, they should not have to do that, but keep in mind that they are doing it more or less voluntarily. As well, they are working that way because they are totally committed to living in rural Canada; and they would not have it any other way. Those same people would not want to live in downtown Toronto and do whatever they have to do in a store to earn more income. The point is that we must utilize the assets these people have. It is there for us as a country to grab those assets and use them to revitalize the whole thing.
That brings me back to the national dream of the railroad that began with a tremendous vision. The founding fathers said, let us build a railway, to which I am sure people said, do not be so silly. However, it was built because there was a vision to build a country. There have been various other visions and we must continue to capitalize on that. We cannot stop having visions. Senator Mahovlich said there were visions in Europe years ago when people said they were crazy for building bridges; but that is a great legacy. Someone should be rewarded for building those bridges or those cathedrals 2,000 years ago. We need to act in kind so that we can leave something from this era, such that, in 100 year's time, our grandchildren will thank the Canadian senators who, in 2007, put out a report that cast a framework for this new rural development. From the history books, that is the way that it can happen. A new process will begin when Canada reinvents rural Canada.
The Chairman: We are not done yet.
Senator Mahovlich: One thing we have not spoken of is education. I came from a little town called Schumacher. What a vision Mr. Schumacher had. We had a public school and a high school. Does Powassan have that?
Mr. Young: We did have a public school and a high school, but today we only have a public school. The Ontario government decided to put the high school elsewhere — amalgamation.
Senator Mahovlich: Is it in North Bay?
Mr. Young: No. There are several high schools in North Bay. There is one in the Almaguin area, which is located 30 kilometres to the south of us, so they bus the students there. The high school students have to bus either to North Bay or to other centres.
Senator Mahovlich: We moved from Schumacher after the kids were educated. Will there be any farmers down the road looking to farm in your area after the kids get their education?
Mr. George: We are facing that exact problem such that the farmers are not there demographically on a commercial basis. I am not up to date on this, but I believe the statistics would show that Ontario will begin to gain in numbers of farmers because we have more part-time farmers coming back. Retired people are working farms that might have been abandoned or downsized.
Rural agriculture, certainly in Ontario, is not dead. It is a totally different kind of agriculture that we will be seeing. There are all kinds of room for niche markets. We have been told about various small operations around Northern Ontario where they are now exhibiting their specialty products at the Royal Winter Fair. The marketing of those products has been done with the help of federal dollars. We must encourage these things to keep happening because it is a whole new world out there.
Senator Zimmer: On the matter of family farms and people moving away from the cities to return, what is your experience with Hutterites buying large farms and settling in large groups? Does that occur?
Mr. George: As Mayor Young said, we have a burgeoning Amish community. I sold my farm to an Amish community. That is exciting for us because many of these families are builders and furniture makers, although we do not have an Amish family that specializes in quilt-making. When we find the Amish family prepared to market on our main street, then we will be able to fill the empty stores about which Mayor Young despairs. People will travel 50 miles from Powassan to buy what the Amish community makes. They have a tremendous reputation for high-quality home building and barn building. We are very excited about that and it will continue to evolve because, by and large, they have large families. They have acquired at least 15 to 20 properties in the space of four or five years. More and more are moving to the area. In fact, some are arriving from as far away as Kentucky.
We are very excited about that future. However, you cannot market those people because they will engage in the local economy when they are ready. Certainly, as chair of the EDC, I am not prepared to try to twist their collective arm. I will wait until we have the right group. They will do it on their own because they are clever business people.
My son, who is here tonight, is a third-year student in economics at the University of Ottawa. Certainly, he has no interest in the farm. Quite frankly, as a former farm leader, I have not encouraged him to farm. After he got a summer job at Canada Revenue Agency, I said to him, thank goodness they do not know who your father is. That is fine by me because my son is not cut out to farm. I will let him make his million dollars wherever he wants to make it. I know he will not make it on my old farm, which is why we sold it.
The Chairman: I am impressed with what you have said today and with the fact that you are as feisty now as you were at 7:30 a.m. today when we first met. Committee members are fairly feisty, too, as you have heard today. Many fine minds and spirits sit around this table. Your remarks represent the kinds of things we want to hear in this committee. We have been on quite a run with this issue over the last year and we need to hear from people like you and from communities like yours. As you know, this meeting will be aired on CPAC and will reach rural folks across the country, including my area of Alberta. They will understand well what you are saying.
Keep your spirits up because we will do the very best we can do. Certainly, we have been encouraged by government for continuing to encourage discussions like the one we have had tonight. They too want to know the answers to these issues.
Your contributions this evening have been valuable to us and we thank you. Powassan should be proud of you.
Mr. George: We are proud to be here. When I look around the table at all the wisdom, I see stick handlers, farmers and political strategists in abundance. I am personally excited, as one with some degree of passion, to have been deeply involved in farm politics across the country for the last 20 or 30 years. I am more excited about this mission to Ottawa today than I have been about many things that I did as a farm leader. Certainly, we wish you well.
I thank Mayor Young for providing me with the opportunity to appear this evening and speak to the Almaguin region. What you hear about the municipality of Powassan is very reflective of about 15-20 municipalities in our immediate area.
Mr. Young: Thank you for having us here and for taking the time to spend with us. It is been an honour and privilege, and I thank senators for their good work.
Senator Fairbairn: We wish you the very best as you carry forward. We hope that others will listen and that times will get brighter for you and the people that you represent.
The committee adjourned.